Jun 27, 2016
From the Financial Reporting Network
The SEC recently proposed a new rule that would eliminate Industry Guide 7 and add new Item 1300 to Regulation S-K to modernize mining property disclosures by public companies by aligning those disclosures with current industry and global practices and standards. The proposal also would provide investors with a more comprehensive understanding of a registrant’s mining properties to help them make more informed investment decisions. Specifically, the proposed rule would:
- Update the definitions of mineral reserves and mineral resources.
- Require a registrant to disclose mineral resources and material exploration results in addition to its mineral reserves.
- Permit disclosure about mineral reserves to be based on a preliminary or a final feasibility study.
- Require, in tabular format, summary disclosure about a registrant’s mining operations as a whole and more detailed disclosure about material individual properties.
- Require that every disclosure about mineral resources, mineral reserves, or material exploration results that a registrant files be based on, and accurately reflect, information and supporting documentation prepared by a qualified person.
- Require a registrant to obtain a technical report summary from the qualified person, which identifies and summarizes for each material property the information reviewed and conclusions reached by the qualified person about the registrant’s exploration results, mineral resources, or mineral reserves.
Comments are due 60 days after the proposed rule is published in the Federal Register.